Finance

The Legal Options in Debt recovery For You

The debt collection company must indicate the amount of debt in a letter requesting the consumer of the debtor to pay the amount of debt, the legal basis for the liability and the period for which the creditor demands payment of the debt.

What is debt collection?

The word ‘recovery’ comes from the Latin word ‘vindicatio’ (investigation, mining). This institution has been known since the beginning of time. In the past, objects and things were recovered. Currently, the debt collection institution most often concerns financial claims. In practice, consumers are faced with two types of recovery:

Court debt recovery it is nothing more than the enforcement of debts from the debtor to the creditor (a company or a natural person whose debtor owes some debts) on the basis of a final court judgment. In the legal system, such debt collection is carried out by bailiffs.

Out-of -court debt recovery includes out-of-court settlement of claims by a creditor from a debtor. Such debt collection may be carried out by the creditor, but sometimes it turns out that such debt recovery is ineffective, so the creditor sells the debt (debt) to a specialized debt collection company called debt collection company.

What is a debt collection company?

A debt collection company is a business entity like any other company. He runs a business involving the recovery of monetary claims, depending on the contract with the contractor the creditor, for the creditor or on his own behalf as a creditor is subject to entry in the register of entrepreneurs.

Why is debt collection needed?

Debt collection is necessary for every company to be able to run a business. Failure to pay fees for large scale liabilities to companies may result in the loss of financial liquidity of the company. Every consumer or entrepreneur must meet their commitments, no matter whether it is a bank loan or a telephone bill, because the company that sold us the service, whether the thing has fulfilled its part of the contract, and we are not paying for this service or thing concluded contract.

What rights does a debt collection company have?

Each company must operate within the limits of the law, general principles of social coexistence, decency and may not make its right of use that would be contrary to the socio-economic purpose of this right.

Acting on behalf of the creditor, i.e. on the basis of a power of attorney to enforce the debtor’s consumer, the debt collection company may: request payment, negotiate repayment terms, conclude settlements. In legal terms, the debtor pays the creditor then through the debt collection company.

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Rose Clark

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